Jet2 says summer price increases will be ‘modest’

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Jet2 says summer price increases will be ‘modest’

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The chief executive of Jet2 vowed customers would face only “modest” price increases this summer as the low-cost airline and tour operator reported record earnings on the back of a continued travel boom.

The UK low-cost airline and tour operator posted a 43 per cent rise in annual pre-tax profits on Thursday to £529.5mn thanks to a surge in demand, with profits, revenue and passenger numbers all hitting new highs.

The Leeds-based company — which flies from 12 UK airports to more than 70 destinations — said it expected demand to remain robust, but pledged to keep prices “attractive” over the peak summer months, in part to adjust to a trend in which customers were leaving it later to book trips.

Jet2 said “passengers are currently booking much closer to departure and therefore, pricing for our flight-only and package holiday products must remain attractive”.

The cost of the group’s package holidays rose 11 per cent last year to £830 on average, as it raised fares to offset rising input cost inflation. Flight-only net ticket yield per passenger increased 14 per cent to £114.23.

On Thursday, Jet2 said it was “mindful” of the economic pressures on customers, and it was only planning a “modest increase” to summer prices.

Chief executive Steve Heapy said: “Demand is as strong as ever . . . People just want to get away and escape the terrible weather they’ve seen in the UK, and I don’t see that changing anytime soon.”

But he said customers booking at a later stage meant the group’s load factor (a measure of seats filled) was lower year on year, currently standing at 73.4 per cent, down from 75.2 per cent.

Jet2 posted a 24 per cent increase in turnover to £6.3bn, and said “future confidence” in the strength of demand had led it to exercise its remaining purchase rights for Airbus aircraft, with 146 A321neo planes to be delivered by 2035.

The update comes as a backlash against tourism has escalated in European countries such as Spain, where an influx of visitors is stirring what has been dubbed “tourism-phobia” by residents furious over issues including unsightly new resorts and soaring rental prices.

Heapy said Jet2 had not seen a drop in bookings for those destinations, adding he expected people to be “drawn to the providers of licensed accommodation” such as Jet2.

In May, Sebastian Ebel, the chief executive of Europe’s largest travel company Tui, said anti-tourism protests were “no threat” to its business.

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